Individual investors own 29% of Epoxy Base Electronic Material Corporation Limited (SHSE:603002) shares but private companies control 57% of the company

Key Insights

• Significant control over Epoxy Base Electronic Material by private companies implies that the general public has more power to influence management and governance-related decisions
• The largest shareholder of the company is Grace T.H.W. Holding Limited with a 50% stake
• Institutions own 11% of Epoxy Base Electronic Material

If you want to know who really controls Epoxy Base Electronic Material Corporation Limited (SHSE:603002), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 57% to be precise, is private companies. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Meanwhile, individual investors make up 29% of the company’s shareholders.

In the chart below, we zoom in on the different ownership groups of Epoxy Base Electronic Material.

View our latest analysis for Epoxy Base Electronic Material

What Does The Institutional Ownership Tell Us About Epoxy Base Electronic Material?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

We can see that Epoxy Base Electronic Material does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Epoxy Base Electronic Material, (below). Of course, keep in mind that there are other factors to consider, too.

Epoxy Base Electronic Material is not owned by hedge funds. The company's largest shareholder is Grace T.H.W. Holding Limited, with ownership of 50%. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. In comparison, the second and third largest shareholders hold about 5.3% and 3.8% of the stock.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Epoxy Base Electronic Material

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our most recent data indicates that insiders own some shares in Epoxy Base Electronic Material Corporation Limited. In their own names, insiders own CN¥179m worth of stock in the CN¥5.5b company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

With a 29% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Epoxy Base Electronic Material. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Company Ownership

We can see that Private Companies own 57%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For instance, we've identified 4 warning signs for Epoxy Base Electronic Material that you should be aware of.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.

NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com